the multiple benefits of efficiency policies
DESCRIPTION
Claude Turmes, MEPRapporteur Energy Efficiency Directive16 March 2012TRANSCRIPT
The multiple benefits
of efficiency policies
Claude Turmes, MEP
Rapporteur Energy Efficiency Directive
Reducing the EU’s foreign energy expenditure
Tar sand
exploitatio
n
Offshore
drilling
Financing
undemocratic
regimes
Investments in oil
prospection and
extraction
€400 bn / year
At least €50 bn / year could be saved and invested at home
Better insulated
homes
Savings for public
budgets
Reduced energy
poverty
Reducing the EU’s foreign energy expenditure
Example of investments triggered - German KfW & co-financing -
• co-financing ratio in 2006 of 1:4, and today of 1:9 !
• 6 billion federal funds, 27 billion efficiency investments, 54 billion private
investment flow
0
2
4
6
8
10
12
14
pe
r ce
nt
Energy-price sensitivity , whole Economy
Energy -price sensitivity, industry
Improving energy efficiency is
improving our competitiveness
China
EU
Energy Efficiency Has Many
Power System Benefits
• Production Energy
• Production Capacity
• Avoided Emissions
• Transmission Capacity
• Distribution Capacity
• Line Loss Reduction
• Avoided Reserves
Plus “Non-Energy” Benefits including:
• Add’l resource benefits (water), building durability, health & safety
* Note: numbers presented in graph are Illustrative
Cents
per
kW
h
0
2
4
6
8
10
12
14
Avoided Reserves
Line Losses
Distribution Capacity
Transmission Capacity
Avoided Emissions
Production Energy
Production Capacity
Source: RAP - Regulatory Assistance Project, May 2011
Efficiency Lowers Clearing Prices – benefits all consumers
7
Lower clearing
price benefits
all consumers
Demand
reduction from
EE
Source: RAP - Regulatory Assistance Project, May 2011
.
.
8
Demand Curve
Supply Curve
The Public Value
of Efficiency
Price
Quantity
P1
P2
Q2 Q1
Assumed
Demand
Shaded area is savings to wholesale market
Efficiency Multiplier:
New England Examples • EE program costs are almost entirely offset by
power market price reductions obtained by all consumers
• (in addition, program participants will have lower consumption and lower bills)
• Connecticut: – Cost of Energy Saved = 2.8 cents/kWh – Bill reductions via DRIPE = 2.72 cents/kWh
• Massachusetts: – Cost of Energy Saved = 3.36 cents/kWh – Bill reductions via DRIPE = 3.31 cents/kWh
9
Source data: Avoided Energy Supply Costs in New England, July 2011 Report, Synapse Energy Economics; Saving Energy
Cost Effectively: A National Review of the cost of Energy Saved Through Utility Sector Energy Efficiency Programs, ACEEE
report U092, Friedrich et al September 2009
Source: RAP - Regulatory Assistance Project, May 2011
Example: New York City Substation Peak MW
10
185
190
195
200
205
210
215
220
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
demand without EE demand with EE current capacity
Source: Data from Figure 1 in Gazze, Chris & Madlen Massarlian, “Planning for Efficiency: Forecasting the
Geographic Distribution of Demand Reductions”, in Public Utilities Fortnightly, August 2011.
Need if no EE
Need with EE
Source: RAP - Regulatory Assistance Project, May 2011
Active Deferral – New York City Results (2003-2010 Benefits & Costs in millions of $)
11
$-
$50
$100
$150
$200
$250
$300
$350
$400
$450
$500
Benefits Costs
Energy Savings
T&D Savings
Other Savings
Vendor Payments
Other Costs
Source: RAP - Regulatory Assistance Project, May 2011
EE - merit order
Energy Efficiency & Carbon Price
Source: IEA, 2011 – Summing up the parts, combining policy instruments for least-cost climate
mitigation strategies
Source: IEA, 2011 – Summing up the parts, combining policy instruments for least-cost climate
mitigation strategies
Energy Efficiency & Carbon Price
EED - Einordnung der Beiträge zur Erreichung des
Gesamtziels einer Primärenergieeinsparung von
20% bis 2020
0
50
100
150
200
250
300
350
400
Mto
e
Primärenergie-Einsparbeitrag Erneuerbare
Energien
Energieeinsparung Verkehrssektor
(gesonderte Maßnahmen)
Energie-Einspar-mechanismus nach
Art. 6 des Richtlinienentwurfs
Weitere Maßnahmen
(Endverbrauch, KWK etc.)
Gesamtziel für die
Primärenergie-einsparung
Quelle: Öko-Institut, 2011
The new Energy Saving Directive
- closing the 200 Mtoe gap -
• Binding Targets (art. 1, 3 and parts 19):
– 20% binding efficiency EU in 2020 (1473 Mtoe)
– Reference values for binding national energy
efficiency targets
– Intermediary targets 2014, 2016, 2018
– EU Commission to verifie (and make infringement
procedures when necessary
AND
Binding measures
– Art. 2a (new): financing: structural funds, EU ETS
– Art. 3a (new): building roadmap 2050
– Art. 4&5: examplary role of public bodies
– Art.6: 1,5% end use energy savings (110 Mtoe)
– Art.7: energy management obligations
– Art.8 & 8a: empowering consumers
– Art. 10&11&12.5: CHP and other supply (50 Mtoe)
– Art.12: grid &efficiency; DSM
– Art. 13&14: ESCO market, training,…
– ART. 19: set aside mandate to correct EU ETS
Source: Karsten Neuhoff et al. DIW - CPI, September 2011 - Thermal efficiency retrofit of residential
buildings: The German experience
EED - Cumulative Savings
Source: Danish Energy Agency, 2012
1.5%
0.6%
Early action
160Mtoe
Sales to transport
Supply-side efficiency
Sales to energy intensive industry
0
Sales volume covered (Mtoe, primary energy)
An
nu
al s
avin
gs
Energy saving obligation (Art.6):
Maximal savings volume in 2020 (start 2014)
1,600 950
40 Mtoe
1,200
1.2%
Zwischenjährige Veränderungsraten von
Endenergieverbrauch, Bruttoinlandsprodukt und
Endenergieproduktivität, 1990-2020
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
1990 1995 2000 2005 2010 2015 2020
gg
ü. V
orj
ah
r
Bruttoinlandsprodukt (BIP)
Endenergie-Verbrauch (EEV)
Energieproduktivität (EEV)
EEV-Ziel nach EU-Vorschlag
Ist-DatenProjektion(Prognos et al. 2011)
Quelle - AG Energiebilanzen, Statistisches Bundesamt, Prognos et al. (2011), Öko-Institut
Interactions between
the 3 targets
Source: IEA, 2011 – Summing up the parts, combining policy instruments for least-cost climate
mitigation strategies
LET US BRING INVESTMENTS IN
And EFFICIENCY WILL
BRING US OUT
OF THE DOUBLE
RESOURCE & ECONOMIC CRISES
